AUDUSD analysis 21.05.2020

The Australian dollar fell during the Asian session to witness its bounce for the second session from the top since March 9, when it tested the highest for it since February 20 against the US dollar after the developments and economic data that it had reported on the Australian economy and on the cusp of developments and economic data expected on Thursday By the US economy, which includes the talk of members of the Federal Open Market Committee.

At exactly 02:13 AM GMT, the Australian dollar pair declined against the US dollar by 0.58% to 0.6559 levels compared to the opening levels at 0.6597, after the pair achieved its lowest level during the trading session at 0.6555, while achieving the highest at 0.6600.

We have followed the disclosure of the initial reading of the Markit Industrial and Services PMI for Australia for the month of May, and the initial reading of the Manufacturing PMI showed that the contraction widened to 42.8 compared to 44.1 last April, while the initial reading of the Services PMI showed The contraction shrank to 25.5 from 19.5 in April.

This comes, hours after the Reserve Bank of Australia revealed last Tuesday the minutes of its last meeting, which was held on the fifth of this month, during which monetary policy makers at the Australian Central Bank decided to fix short-term reference interest rates for the second consecutive meeting at the lowest ever at 0.25. %, Which came in line with expectations at the time.

The minutes at the time stated that the Australian central bank will not increase interest until the economy shows progress towards full employment and sustainable inflation within the target range between 2 ~ 3% and that the speed and timing of the economic recovery are uncertain and that it is ready to increase its purchases of bonds, and investors are now looking to share the bank’s governor Australia Reserve Philip Lowe at a panel discussion at the Institute of Financial Services Australia in Sydney.

On the other hand, investors are currently awaiting by the US economy the release of the aid claims index for the last week on May 15, which may reflect a decline of 581 thousand applications to 2,400 thousand applications compared to 2,981 thousand requests in the previous reading, while the reading of subsidy applications may appear Continuing for the last week on the eighth of this month, increasing by 1,932 thousand requests to 24,765 thousand requests compared to 22,833 thousand requests.

This comes in conjunction with the disclosure by the largest industrialized country in the world of industrial sector data, with the release of the Philadelphia Industrial Index reading, which may reflect the contraction to 40.0 compared to 56.6 in April, and before we witness the disclosure of the initial reading of the Markit industrial PMI For the United States, which may reflect the contraction shrinkage to 39.3 compared to 36.1 in April.

It also revealed the initial reading of the Services PMI that may reflect the contraction in value to 32.6 compared to 26.7 in April, before the release of the leading indicators, which may explain the decline in the decline to 5.5% compared to 6.7% last March, in conjunction with The release of the Existing Home Sales Index, which may explain the widening decline to 18.9% to 4.31 million homes compared to 8.5% at 5.27 million homes in April.

All the way to FBI members ’satellite talk, New York Fed President John Williams at the Greater Rochter Chamber of Commerce and Federal Reserve Governor Richard Clarida’s views of the US economic outlook and monetary policy at the New York Business Economics Association, before we witness the introduction of the Fed’s governor Jerome Powell introductory notes about Coronavirus at a federal event

Technical analysis

The Australian dollar versus the US dollar pair has returned to rise after the lateral fluctuation in the previous sessions, to resume the main bullish path that is being organized within the bullish channel, and the path is open to achieving our next expected target at 0.6685.

Therefore, we will continue to favor the bullish direction over the intraday and short term, keeping in mind that stability above 0.6555 is a prerequisite for the expected continuation of the uptrend.

The expected trading range for today is between 0.6530 support and 0.6685 resistance.

Expected trend for today: bullish.